Rate Deal
70 collier street L4M 4T5 Barrie, ON, Canada

https://www.realtor.ca//17526-60-HIGHWAY-Wilno-Ontario-K0J

Residential Market Commentary - Are rising rates raising the bar? Anyone trying to qualify for a typical mortgage in Canada has just had the bar raised another couple of notches. The big banks have been bumping up their five-year fixed rates for the past couple weeks. Now the Bank of Canada is following suit with an increase to its qualifying rate. The central bank’s conventional, five year mortgage rate now stands at 5.34% up 20 basis points from 5.14%. It is the fifth in...crease since May of last year. The Bank’s benchmark interest rate has been raised just three times, over about the same period (since July ’17). The qualifying rate is separate from consumer mortgage rates but it is an important benchmark in light of the B-20 stress test that was imposed on non-insured mortgage holders, back in January. The new rules require that even home buyers with at least a 20% down payment must qualify for a mortgage at the BoC qualifying rate, or at 2% more than the rate they have negotiated with their bank, whichever is higher. Market watchers point out that, as usual, the increase will hit first time buyers the hardest. It will make borrowing more expensive and it will reduce the amount buyers can, ultimately, qualify for. What remains to be seen is how the increase will affect renewals. By one estimate 47% of mortgages are up for refinancing this year compared to the normal rate of 25% to 35%.

Residential Market Commentary - Is stabilization occurring in Canada's hottest markets? April figures suggest Canada’s biggest and hottest real estate markets may be starting to show signs of something that resembles stabilization or not. In the Greater Toronto Area, April’s average price across all home types was a little less than $805,000. While that is down 12% from a year earlier it is just 0.2% below the average price in March. Sales increased by about 8% in April o...ver March, but were down 32% compared to a year ago. Using the March/April comparison the Toronto Real Estate Board feels that the sales trend has flattened out. By that standard Greater Vancouver also saw some stabilization, In April prices climbed an average of just 0.7% over March. However, year-over-year, April’s average was up more than 14%. Vancouver sales increased a moderate 2.5% m/m, but were down by more than 27% y/y. Real estate boards in both Toronto and Vancouver cite the tougher federal mortgage rules as a key factor for the numbers. But both jurisdictions are also dealing with the fallout from provincial legislation designed to cool markets. Vancouver is, in fact, facing a second round of regulation, including an increase to its foreign buyers’ tax and its expansion to other parts of British Columbia. Given that Vancouver seemed to shake-off the first round of regulation, it remains to be seen how effective the second round will be. It also remains to be seen whether buyers and sellers in Toronto have really calmed down, or if they are just waiting for the uncertainty created by government intervention to go away.

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